Volume Analysis | Flash Update: Operation Santa’s Rally– 12.16.24

Battlefield Report: Week Ending 12-13-2024

For the second consecutive week, the Tech Generals (NDX 100 Index) marched forward in their Christmas campaign. While last week they had just enough strength to pull the S&P 500 brigade up with them, this past week they advanced alone, leaving their comrades behind scurrying off in the trenches.

Troop Movements:

Tech Generals (Nasdaq 100 Index): Advanced 0.73%

• Marching solo towards the North Pole

S&P 500 Brigade (S&P 500 Index): Retreated -0.64%

• Retreated despite being carried by the Tech Generals

Equal Weight Division (Invesco S&P 500 Equal Weight ETF, RSP): Fell back -1.64%

• Suffered heavier casualties than its capital-weighted counterpart

Foot Soldiers (iShares Russell 2000 ETF, IWM): Led the retreat, down -2.45%

• Struggling to maintain their position in Santa’s toy factory but holding support

Brass Commanders (Schwab US Dividend Equity ETF, SCHD): Closely followed the retreat, down -2.39%

• Losing ground in the fruitcake trenches but also holding above support

Intelligence Report:

• S&P 500 Supply Lines (Capital Weighted Volume): Modest, with higher than normal downside movement

• Capital Flow Reinforcements: Outbound sleighs (outflows) slightly outnumbered inbound inflows

• Battlefield Breadth (NYSE Advance-Decline Line): Narrowing, approaching critical support level

• High Ground Occupation: Fewer troops reaching new heights

Strategic Positions:

• Foot Soldiers (IWM) entrenched nearing its 225 support level

• Battlefield Breadth (NYSE A-D Line) holding a defensive line

Mission Outlook:

The broadening offensive has paused, with the Tech Generals advancing alone. It’s crucial for our forces to hold the current support levels to keep Operation Santa’s Rally alive. If the Foot Soldiers (IWM) and Battlefield Breadth (NYSE A-D Line) can maintain their positions, we may still see Saint Nick’s sleigh soaring over Wall Street.  Otherwise, investors may find coal in their Christmas stockings.

The market battlefield shows signs of division, with Tech Generals outmaneuvering while other divisions retreat. This divergence, coupled with narrowing battlefield breadth, calls for tactical caution. The success of Operation Santa’s Rally depends on holding key support levels. All eyes are on these strategic positions as we approach the holiday season.  Investor should consider closely monitoring these fronts for any signs of reinforcement or further retreat in the coming weeks.

Grace and peace my friends,

BUFF DORMEIER, CMT

Updated: 12/16/2024. Historical references do not assume that any prior market behavior will be duplicated. Past performance does not indicate future results. This material has been prepared by Kingsview Wealth Management, LLC. It is not, and should not, be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate their ability to invest for the long term. Investment advisory services offered through Kingsview Wealth Management, LLC (“KWM”), an SEC Registered Investment Adviser.